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How employers can fight the rising cost of private medical insurance
The UK is feeling the squeeze from both a local and worldwide hike in private medical insurance costs.
It’s tough in the insurance business, where companies are looking at significant insurance premium increases – next year, the cost of private medical insurance is set to jump by a whopping 11.2%.
That’s not just above the global average of 9% – it’s nearly two percentage points ahead of Europe. These numbers are a wake-up call for businesses across the UK, underscoring a pressing need for attention, action and a plan with longevity.
Leap in claims
The demand for mental health services has increased significantly, a trend that was, of course, accelerated by the Covid-19 pandemic. Some estimates say that 1.2 million people are on the NHS mental care waiting list as of 2023.
It’s clear demand is there, but the resources are lacking.
This surge in demand has a direct impact on employee insurance costs. The cost of employee health insurance for small businesses with up to 250 employees varies from £20 to £100 per employee monthly. But, factors such as team size, employee age and pre-existing conditions can affect these costs significantly.
These escalating costs contribute to insurance premium inflation, creating a cycle that’s becoming increasingly expensive to maintain.
The surge in insurance claims has made it clear that addressing mental health is not only beneficial for society but also essential for building better financial sustainability for people and businesses alike.
That’s why wellness initiatives are such powerful tools, particularly when they are executed effectively. Providing access to a wellbeing benefit that boosts employees’ physical activity and mental wellbeing can significantly reduce the risks associated with the UK’s most pressing health issues.
Wellhub’s Work-Life Wellness Report found that users can reduce company healthcare expenses by up to 35%. These measures provide a double benefit: they enhance employee wellbeing and lead to financial health for insurers and insured alike, forming a critical part of the solution to this growing challenge.
Why traditional solutions aren’t working
While traditional corporate health solutions, such as medical benefits, play an important role in supporting employee health, they often fall short of addressing the deeper, systemic issues that drive poor mental wellbeing among employees.
When thinking about addressing the health of employees, companies often look to treating symptoms rather than tackling the root causes.
This can add to a cycle of dependency without really improving long-term health.
Within this whole context, it’s important to note that the NHS is experiencing major backlogs, only increasing the reliance on private medical insurance. The need for a more sustainable approach is more obvious than ever.
To be truly effective, health initiatives must go beyond superficial measures. While offering paid time off is a great start, there needs to be a wider conversation about wellbeing both inside and outside of the office. Companies need to foster a culture of wellbeing that integrates health into every aspect of the workplace environment.
This shift requires a strategic rethinking of how health benefits are structured and delivered, moving away from band-aid solutions to more integral, enduring strategies.
Multifaceted approach
Addressing the soaring costs of private medical insurance in the UK demands a multifaceted approach.
Insurance premium inflation and an escalating demand for mental health services in the UK contribute to a need for action.
As businesses navigate these challenges, the focus must shift towards holistic wellness initiatives that not only curb costs but also promote healthier, happier and more productive work environments.
By investing in comprehensive wellbeing programmes companies can pave the way for a future where premium health doesn’t come at premium costs.
Wellhub enables a proactive approach to employee wellbeing, fostering a workforce that is not only healthier but also more engaged and resilient.
Transform your corporate wellness strategy today for sustainable health benefits and substantial cost savings with Wellhub.
